How to win business on the spot!

THERE ARE REWARDS AS WELL AS RISKS to providing people with a quote for work, but one of the bigger risks is offering a free measure and quote, only to have the quote knocked back in favour of a competitor’s cheaper one.

This said, despite the risks attached to offering to come out for free and quote a job, it’s still a good way to operate your business.

Why a free measure and quote is good

There are a lot of benefits to visiting a client to provide a free measure and quote, even if you run the risk of wasting your time and money should the quote not be accepted. We take a look at some of these:

You’ll better understand the client and scope of works

Quoting for a job will help you to understand the client and the scope of the project at the same time. People are put more at ease when they know they’re not obligated to pay you just to come out and prepare a quote, so you’ll have better luck getting prospects. You’ll also be able to discern the kind of client the prospect is likely to be, so you can weigh up how to proceed.

Helps you evaluate potential risks

Remember risks can involve both the physical risk of injury but also other more nebulous risks, like a client who doesn’t pay on time or is unrealistic about timeframes, costs or the types of materials required. With experience, you’ll become better at seeing the warning signs early on, but if you’re new to being self-employed, these are things you should pay particular attention to.

How to make a sale there and then

As we said in our previous post about the risks and rewards of quoting, if you make it easy for people to do business with you, you’re more likely to get quick or even immediate acceptance of your quotes. This is really important as a business, because it keeps in a steady stream of work, which is good for your cash flow, and ultimately, costs you less money — because you’re not following up on unaccepted quotes — in the long run.

Demonstrating efficiency, organisation and enthusiasm are clearly attractive qualities in any builder, tradesperson or other small business person who provides on-site quotes (they’re attractive qualities in anybody!) because it shows that you care about the work you do and that you’ll do it in a timely manner.

When charging a daily rate pays

CHARGING A DAY RATE FOR YOUR WORK, instead of an hourly rate, can be a good way of making sure you get paid a certain amount for each job. This can help you set a budget and ensure you’re bringing in a certain amount of money each week. It also gives your clients some peace of mind, because they will know how much to set aside to pay you.

Charging a day rate can help you set a budget and ensure you’re bringing in a certain amount of money each week.

But just as there are advantages to charging a day rate, there are some disadvantages too.

Pros of day rates

You’re getting a flat fee, so if the job doesn’t take as long as you anticipated, you’re still getting paid the same amount to complete it.

It’s easier to get clients, because they’ll feel more secure knowing from the outset how much the job will cost.

It gives structure to your finances, which is important when you’re first starting out.

Cons of day rates

It ties you down to one job. Sometimes you can earn more money by doing a number of smaller jobs in one day, rather than just one job.

It gives you less flexibility to leave the job site, say, to quote on other work, or if any other circumstances arise that mean you have to leave the job periodically. It might not be convenient for you or others to make up extra hours at another time or extend your day.

If a job runs longer than anticipated, or is more specialised than anticipated, you could find yourself out-of-pocket or not getting paid as much as you could.

If you run into a previously unforeseen problem or specialised area, it can be difficult to get the client to pay more than what you originally agreed on.

You must quote thoroughly for the job beforehand, so you need to be experienced to ensure you’re quotes aren’t too low.

Not all projects are well-suited to charging a day rate, particularly if they’re complex and have the potential to be time-consuming.

Jobs that are straightforward or where most of your day will be spent doing labour work are better suited to day rates, leaving the longer, more intricate work that has the potential to take a long time to an hourly rate.

How you know what’s working and what’s not

MARKETING AND ACCOUNTING ARE CLOSELY linked if you look at accounting as dealing with the money that’s going in and out of your business, usually as a consequence of your marketing activities.

Recording your marketing activities

In our new online training course, Cash Flow Reporting, Budgets and ROI for Xero, you’ll learn how to enter all of your business’s expenses, including the money you spend on marketing. Anything to do with making your business “discoverable” by a potential customer is considered a marketing activity.

Anything to do with making your business “discoverable” by a potential customer is considered a marketing activity.

That includes business cards, website costs, domain names, Google AdWords, etc, and should be recorded in Xero as a marketing expense.

Determine marketing ROI

To determine your Return on Investment (ROI), you should use Excel or a marketing platform like Hubspot to record where your business comes from so you can assign each activity an income stream.

It’s important to monitor how your marketing spend is performing for your business. Otherwise how will you know what’s working and what’s not?

In our Cash Flow Reporting, Budgets and ROI course for Xero, you’ll go through the steps required to determine the ROI for certain areas of a business. If you refer to the Excel spreadsheet showing the income generated by particular marketing activities — print ads, hipages subscriptions, Google AdWords, etc, you’ll be able to work out the ROI.

Monitoring how your marketing spend performs for your business is incredibly important. It’ll help you to see what’s working, what’s not working, and what needs to be changed to make it perform better.

Ways to get regular installation work

BUNNINGS HAS, FOR A LOT OF HOMEOWNERS, become the default place to get their home renovated — and not just the DIY renovators, either. Bunnings, very wisely, realised that a lot of the people who came to look at their kitchens and bathrooms were going to have a tradesperson install them.

Bunnings made the smart move of partnering with local tradies — cabinet makers, builders, plumbers, and so on — to also offer an installation service, like other kitchen and bathroom companies.

Partner with big business

Just as every good tradesman or tradeswoman will partner with other local tradespeople so they can refer business to each other, it’s wise to partner with bigger business — like Bunnings or Mitre 10, and so forth — which can refer work to you when they have customers in need of your services.

Every good tradesman or tradeswoman will partner with other local tradespeople so they can refer business to each other.

Use online marketplaces

Lots of online marketplaces like Airtasker and Hipages partner with retailers to offer installation services to their customers. Airtasker, for example, partnered with the Good Guys, so customers could find someone to install their new TV or Bose system.

Likewise, Hipages partnered with IKEA, Ray White and the Housing Industry Association (HIA) to provide them with top quality tradespeople who can provide installation and other types of work.

Big business provides security

Working with a business like the Good Guys, IKEA or Bunnings provides better payment security for your business. In the case of Bunnings, they will typically measure and quote for a job at a set price. This just leaves it up to you to complete the job, and then get paid.

You’ll want to keep up your online marketing and advertising, so you’re getting your own jobs, with the potential to earn more money. The jobs you get through Bunnings or the Good Guys just help to keep the home-fires burning when you’re waiting for your other jobs to get approved.

Online marketplaces bridging the gap for tradies

THE AREA A LOT OF TRADESWOMEN and tradesmen struggle with is turning prospects into customers; in particular getting their quotes and estimates approved so they can commence work. But online marketplaces like hipages, Airtasker, Oneflare, ServiceSeeking, and a raft of others, are helping to close that gap.

Online payment facilities

These marketplaces are helping to protect the money of the consumers using them as well, but offering escrow services. Airtasker, in particular, was the first online marketplace in Australia to add a payment facility to its platform that allows customers to pay for a job, which will be held until the job is complete and both parties are satisfied.

Helping small businesses grow

Hipages and Oneflare are owned by News Corporation (majority owners of Realestate.com.au) and Domain Group (operators of rival property portal Domain) respectively. Both real estate portals are investing heavily in growing their ancillary revenues — that is, revenue from sources other than property ads — by recommending services that homebuyers and sellers are likely to need next. To this end, Domain recently launched a mortgage lending service called Domain Loan Finder, as a joint venture with Lendi.

If you’re a builder, removalist, cleaner, plumber, electrician, labourer, painter and decorator, or other kind of trademan or tradeswoman, then advertising on either hipages or Oneflare is probably a no brainer. As Realestate.com.au and Domain begin to offer these services directly from the real estate listings on their sites, apps, email marketing, and so on, this where most homeowners will find their next tradie.

If you’re a tradesperson, then advertising on either hipages or Oneflare is probably a no brainer. As Realestate.com.au and Domain begin to offer these services directly from the real estate listings on their sites, apps, email marketing, and so on, this where most homeowners will find their next tradie.

Oneflare and Hipages, through their association with Domain and REA Group, will become sites for highly skilled tradespeople, while the Airtaskers and ServiceSeekings will remain sites for lower-cost tradespeople.

Learn how to make Google love you

FOLLOWING ITS ACQUISITION BY AMERICANtelecommunications company, Verizon, Yahoo! is officially no more. So it should go without saying that Google, officially, is the premier search engine if you want your business discovered online.

It’s official: Google is the premier search engine if you want your business discovered online.

Google offers lots of tools to help businesses get discovered by its algorithms, including Google My Business, a free tool that gives your business a listing at the top of Page One on Google Search, as well as a place marker in Google Maps.

Create a Google My Business account

Many business people, including tradespeople, use cloud accounting software like MYOB and Xero to do their bookkeeping. Similarly, many tradies and others already have websites. However, even though your business may already have a website that’s been indexed by Google and shows up in search results for specific keywords, you won’t automatically have a Google My Business account.

You need to set that up separately, by entering in your business information — including your business address — which will be verified by Google. Once your business is verified by Google, you can then begin adding and adjusting your business’s logo and other imagery.

Then get the FREE Google Website

A website is an absolute must for any business operating today. Even if you primarily get leads from offline sources, or you do the majority of your work face to face, a website is still an invaluable tool for turning those prospects into customers.

To revisit the tradesperson example, very few people engage the services of a tradesman without doing some research online first. Your business’s website will be their first port of call. If you don’t have a website, they’ll look for reviews on a Google listing to see what other customers have said about you.

If they can’t find either, unless you were recommended by someone they know, they may choose to go with another business, which has a website, Google listing, or both. At the very least, it just tends to give people peace of mind.

Google now offers businesses with a Google My Business account a free website, already optimized for its search algorithms, and for mobile devices. It’s also easy to use with your custom domain, and is Google AdWords ready, for when you’re ready to kick your marketing up to the next level.

Want help setting up your Google My Business account and finding more leads for your business? See our digital marketing strategy.

How to quote ON THE JOB

FOR TRADESPEOPLE, SOURCING NEW WORK and ensuring you’re getting paid on time, are integral parts of running your own business. As a tradie, the time between quoting for a job and it being accepted by a client can often run into weeks — or worse, months — which can adversely affect your business’s cash flow.

Unlike other small businesses, which can quote for jobs without having to leave their office, a tradesperson has to measure and quote for each job in person. It’s in a tradesperson’s best interest, then, to convert the vast majority of those quotations into jobs.

Quote online, in real time

Many tradespeople, while they may using a cloud-accounting package like Xero or MYOB AccountRight Live, they’re not using it efficiently.

Each time you go out to measure and quote for a new job, draw up the quote on your smartphone or tablet, and send it to your prospect while you’re still talking to them (some cloud-accounting packages allow you to send quotes and invoices by text as well as email).

Each time you go out to measure and quote for a new job, draw up the quote on your smartphone or tablet, and send it to your prospect while you’re still talking to them.

Sending a quote to a prospect before leaving, gives them the opportunity to ask any questions they may have, and may just result in immediate acceptance. But even if they don’t accept right away, it shows you’re keen, capable and ready to do the work.

If they have to wait a day or more for the quote, it could send the message you’re too busy or not interested. It’s also gives the prospect time to “cool off” from the initial excitement, and potentially have second-thoughts about getting the work done.

Connect to your sales software

The next thing you need is to make sure you have a full history of correspondence with your prospects. If you’re not already, you should start using a sales application, like Hubspot. Its basic plan is free, while its premium plan costs US$50/month. Hubspot connects to your Gmail account, and lets you send tracked sales emails — you can also connect it to an application like AWeber or Mailchimp to send marketing emails.

By sending your quotes and other sales emails through your sales software (Hubspot also lets you make free voice calls anywhere in the world), they’ll be tracked, so you not only have a full record of your correspondence with that prospect, but you’ll also see when they’ve opened your emails, clicked on links, opened documents, and so on.

You can also share your calendar with prospects so they can see times when you’re available to complete their job, without having to call and find a suitable time.

Follow up, follow up, follow up!

If you don’t personally have the time to follow-up, you should have someone do it for you — hire a virtual assistant, for instance. A lot of the time, depending on the job, people are still weighing up whether to get the work done and when. A phone call is often all it takes to get a quote accepted.

If you can’t get hold of them on the phone, then “automate” your contact with your prospects. Use your sales software to send “sequenced” emails — that is, a series of emails scheduled to go out at a particular time, when the recipient has or has not taken a particular action.

If you can’t get hold of them on the phone, then “automate” your contact with your prospects.

Established brands are fighting the Internet and the agents who used to work for them

Recently some very high profile McGrath real estate agents and executives have left the brand, including Steven Chen (Projects Division), Richard Shalhoub (Millers Point, Sydney agent), Matt Lahood (Head of Sales), Geoff Lucas (John McGrath’s long time Lieutenant). Our own showcase Cammeray real estate agent Derek Farmer has also now left McGrath and can assist vendors in finding a good real estate agent in their area.

But it’s not just real estate agents leaving a brand like McGrath, it’s also about individual real estate agents who work running their own business within an agency who are discovering that it’s important to focus on their own personal brand to help vendors learn a bit more about them. We’ve spoken to many agents from Marshall Rushford’s Melbourne city patch in Caulfield, Esternwick and St Kilda to regional areas like Orange and Lismore in New South Wales and they are all realising the shift in the real estate industry because of the Internet and the growing power of the property portals (realestate.com.au and domain.com.au).

Real estate agents share commissions with their agency

Anyone in sales understands that the financial rewards are excellent if you can sell and good real estate agents spend half their time selling themselves to people ready to sell their homes as well as selling the listings they currently have. This is why it’s important to be trustworthy when speaking to buyers because one day these buyers will end up being sellers – or know someone who is selling their home.

Many good real estate sales agents work on a commission basis because their commission split with their agency is higher and this is why good agents are attracted to real estate agency brands like McGrath and Belle but this is the market space that is changing rapidly.

A strong brand like McGrath uses their brand in negotiations with agents and will often give the agent between 30-40% of the commission they earn when a property is sold. The very best McGrath agents may earn up to 50% of the commission and this is a big issue that causes good agents to leave a brand and go out on their own – after all a good real estate agent is fully licensed to operate their own agency! With very little need to rent office space and the ability to work from a home office with a part time employee (or husband/wife) as a property assistant many good real estate agents are signing up with seemingly unknown brands like Dot Com in Newcastle.

Most franchisers charge about 20%

If you look at other industries where joining a franchise is a popular way to start a business you’d be aware that they charge an ongoing franchise fee of between 8-30% and for most professional services this percentage settles at around 20% so it’s little wonder that good real estate agents get dissolutioned when they have to pay over 50% of what they earn to use a brand name. To make matters slightly worse, these real estate agents still have to pay for their office space, their staff, their own marketing and advertising and all the other costs of running their own business.

Websites, social media Facebook pages and sign trailers are replacing the shopfront

I was speaking with a property management business owner recently and she confessed the only reason she went to the office is to photocopy some documents and get the receptionist to witness something, the rest of the time she was out and about seeing customers and inspecting properties and this is a sign of the times for most professions. Website and Social media marketing give real estate agents the opportunity to be discovered by sellers and sign trailers can be parked in busy areas (as well as at properties for sale) to stay front of mind in the local area.